Hong Kong as an ESG Financial Hub: Mechanisms through Which International ESG Capital Supports China’s Green Transition
DOI:
https://doi.org/10.62051/1pyf9s93Keywords:
Hong Kong; green bond; ESG; China’s green transition.Abstract
This paper examines the role of Hong Kong in the allocation of ESG capital. The article constructs mechanism framework of "institutional compatibility, market infrastructure, asset pricing and information identification", and analyzes how financial centers can reduce institutional and market frictions in cross-border green investment. Taking the example of Goldwind Technology issuing green bond in Hong Kong in 2015 as a case study, the research finds that Hong Kong promotes the entry of international ESG capital into China's green projects through its regulatory system align with international standards, mature bond market and green certification mechanism. Research shows that Hong Kong plays a significant connecting role in ESG capital and China's green transformation.
Downloads
References
[1] Vidal-García, J. and Vidal, M. 2025. A review on ESG investing.
[2] Yue, M. and Nedopil, C. 2025. China green finance status and trends 2024-2025. Griffith Asia Institute, Griffith University (Brisbane) and Green Finance & Development Center, FISF Fudan University (Shanghai).
[3] Hong Kong Monetary Authority. 2022. Annual Report 2022. Hong Kong: Hong Kong Monetary Authority.
[4] Dhaliwal, D. S., Li, O. Z., Tsang, A. and Yang, Y. G. 2011. Voluntary nonfinancial disclosure and the cost of equity capital: The initiation of corporate social responsibility reporting. The Accounting Review, 86, pp. 59-100. DOI: https://doi.org/10.2308/accr.00000005
[5] Chava, S. 2014. Environmental externalities and cost of capital. Management Science, 60, pp. 2223-2247. DOI: https://doi.org/10.1287/mnsc.2013.1863
[6] Khanchel, I. and Lassoued, N. 2022. ESG disclosure and the cost of capital: Is there a ratcheting effect over time? Sustainability, 14, p. 9237. DOI: https://doi.org/10.3390/su14159237
[7] Krueger, P., Sautner, Z., Tang, D. Y. and Zhong, R. 2024. The effects of mandatory ESG disclosure around the world. Journal of Accounting Research, 62, pp. 1795-1847. DOI: https://doi.org/10.1111/1475-679X.12548
[8] Hail, L. and Leuz, C. 2006. International differences in the cost of equity capital: Do legal institutions and securities regulation matter? Journal of Accounting Research, 44, pp. 485-531. DOI: https://doi.org/10.1111/j.1475-679X.2006.00209.x
[9] Amihud, Y. and Mendelson, H. 1986. Liquidity and stock returns. Financial Analysts Journal, 42, pp. 43-48. DOI: https://doi.org/10.2469/faj.v42.n3.43
[10] Akerlof, G. A. 1970. The market for “lemons”: Quality uncertainty and the market mechanism. Quarterly Journal of Economics, 84(3), pp. 488-500. DOI: https://doi.org/10.2307/1879431
[11] Xinjiang Goldwind Science & Technology Co., Ltd. 2015. Proposed issue of U.S. dollar-denominated credit enhanced bonds. Announcement, 13 July.
[12] Reuters. 2015. China’s first green bond to spur interest for future deals. Reuters, 20 July.
[13] World Bank Group. 2022. China Country Climate and Development Report. Washington, DC: World Bank Group.
Downloads
Published
Issue
Section
License
Copyright (c) 2026 Transactions on Economics, Business and Management Research
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
